Upper Midwest Session Spotlights Electric/Telco Broadband Partnership

Randy Sukow/Jun 26, 2018

Minnesota has an established history of partnerships bringing broadband service to remote areas and those partnerships have taken several shapes and forms – telcos working with municipal or county governments, private/government partnerships and telcos working with electrics. The latest Minnesota telco/electric success story was the focus of a recent e-connectivity listening event, sponsored by the U.S. Department of Agriculture and organizations including NRECA, CFC and NTCA, the Rural Broadband Association.

Consolidated Telephone Co. (CTC) in Brainerd, MN, and Mille Lacs Energy Cooperative in Aitkin began working together two years ago. “My very first day on the job was at the board meeting where our technology expert presented to the board a partnership with CTC … So, after 28 years in the electric industry, I got welcomed to broadband and the telecom industry,” said Mille Lacs EC CEO Brian Zelenak during the session last week in Faribault, MN.

Today, CTC and Mille Lacs EC are completing their first fiber-to-the-home project, which will serve homes along 106 line-miles, connecting CTC’s central office with Mille Lacs’ headquarters and Spirit Lake, MN, substation. So far, the project has about 400 members signed up for broadband, including 150 now getting service, out of a total 15,000 total electric co-op members.

While some electric cooperatives around the country have been able to enter the broadband business without partnerships, Zelenak would come to be glad he had a telephone cooperative to help him through this new stage of his career. “Our project was possible because of the [state] grant and because of the partnership. We would not be doing it otherwise,” he said. “We chose not to reinvent the wheel. CTC knows what it’s doing in this space.”

Kristi Westbrock, CTC CEO and general manager (pictured above right, with Zelenak) described the typical way that her telco enters into partnerships. A major employer in a small town will announce that it will have to relocate unless it can get access to faster and more reliable broadband service. CTC has the experience of other partnerships, including one other partnership with an electric company. It has proven able to turn desperate situations around.

Westbrock echoed Zelenak’s statement. “It is very important that if a municipal or a power company is going to get into this, they have to have the expertise,” Westbrock said. “We feel strongly about that because we’ve seen those projects that haven’t worked … We want it built right the first time.”

Minnesota’s approach to using state grants and encouraging partnerships has been mostly successful. Ninety-one percent of the state population has access to internet service at 25 Mbps downstream and 3 Mbps upstream, said Danna MacKenzie, executive director of the Minnesota Office of Broadband Development, which administrates the grant program. But, MacKenzie said, those last households have proven the hardest to reach.

A panel including Steve Fenske, government relations manager for the Minnesota Association of Townships and Bill Esbeck, executive director of the Wisconsin State Telecommunications Association, (pictured left) described the “rural/rural divide” that currently makes up the unserved regions. Some homes rural homes have ready access to 25/3 service, it is not cost-effective to provide that speed in other rural areas, even with grant and universal service support. There is controversy over what level of service is fast enough.

Members of the Minnesota legislature have carried on a battle over whether to support wireless or satellite technologies that might not reach 25/3. At the same time, eligibility for universal service requires minimum speeds of 10 Mbps downstream and 1 Mbps upstream. 10/1 is, Esbeck said, “a good first step. If you have 10/1, you can stream two HD Netflix movies at the same time in your house … It is a functional broadband service. It will allow you to telecommute.”

“There almost is a technology paralysis over which technology is right or which is the best. That seems to be what a lot of lawmakers ask, ‘What is the best one,’” Fenske said. “Within the last two years we’ve had this 5G discussion. 5G looks tremendously awesome, but from what I’m told, it’s not likely to be deployed in these townships … [Some lawmakers] say this is going to solve the problem. Just wait. But that message of just wait is something township residents have heard for 20 years.”

Townships in Minnesota are small subdivisions of counties that are outside of the incorporated town centers. Looking at a map of Minnesota broadband coverage, remote townships are the most underserved areas. Fenske’s association advocates for the townships in the state government.

He said that townships are losing population and economic opportunity and can’t afford to wait. “We spend a shocking amount on postage because a lot of our members don’t have email,” Fenske said.